MORE THAN 100 UNIVERSITIES AND COLLEGES INCLUDED IN OFFSHORE LEAKS DATABASE

MORE THAN 100 UNIVERSITIES AND COLLEGES INCLUDED IN OFFSHORE LEAKS DATABASE

Hidden in the 25,000 offshore entities we added to the Offshore Leaks Database today are some of the world’s most prestigious universities and colleges.

ICIJ and its partners found more than 100 educational institutions in offshore law firm Appleby’s client database, which was part of the Paradise Papers leaks.

Some of these elite institutions hold tens of billions of dollars in their endowments, and in the eyes of the law, they are treated as charities: altruistic, mission-driven and tax-exempt.

The only time university endowments pay taxes is when they invest in debt-financed financial firms such as private equity funds and hedge funds. These investments are considered a business activity unrelated to their tax-exempt missions.

As ICIJ’s partners at The New York Times reported, large numbers of universities have adopted an offshore scheme that allows them to avoid even those taxes. The universities assign entities called “blocker funds” legal responsibility of otherwise taxable investments. These entities are incorporated in zero-tax jurisdictions such as Bermuda and the Cayman Islands.

American universities whose endowments appear in the Paradise Papers using blocker funds include Columbia, Dartmouth and Johns Hopkins.

Dozens of other U.S. colleges, as well as flagship universities in the United Kingdom and Canada, appear connected to blocker funds, as well as offshore investments in the oil and gas industry or other companies and financial firms based in tax havens.